Strengthening Capacity for Aid Effectiveness in Bangladesh

What is the project about?

AEBPhoto: UNDP Bangladesh.

Despite Bangladesh’s continued economic growth, the country needs foreign aid to achieve its goal of becoming a middle-income country by 2021. Although, as a percentage of GDP, the contribution of foreign assistance is becoming smaller (less than 2% in 2014), the government still needs a significant amount of aid to implement its annual development plan (over 30% of the ADP in 2014 was funded by foreign aid). A number of assessments have shown that the development assistance should be better managed, coordinated and aligned with national priorities and systems to result in greater benefits for the country.  The Economic Relations Division (ERD) is the main  agency of the government for aid coordination and aid management.  To achieve national growth targets, ERD needs to improve its capacities to ensure effective and efficient use of foreign resources. 

Against this backdrop, the Aid Effectiveness project is being implemented to promote aid effectiveness in Bangladesh and in particular to strengthen GoB’s aid management capacities and systems to improve development results. The objective of the project is to increase the effectiveness, transparency and accountability in allocation, management and use of foreign assistance by strengthening national aid management capacities and systems, as well as by enhancing collective dialogue and coordination mechanisms. This is to be achieved by: 

(1) enhancing GoB’s aid information management capacities and access to aid information by Parliament and CSOs 

(2) strengthening aid management capacities of the ERD 

(3) strengthening the Local Consultative Group Mechanism 

(4) Strengthening aid coordination and management capacities of selected line ministries.

What have we accomplished so far?


• The project has supported ERD in developing a homegrown online aid portal called Bangladesh Aid Information Management System or Bangladesh AIMS ( - a web based software application that will help the country to track and manage its aid flows. Bangladesh AIMS now serves as a single-entry window for all foreign aid related information in the country. Bangladesh is one of the few countries to develop a homegrown system. 

• Through the active project support, LCG has turned into an established forum for more regular constructive development dialogue between DPs and GoB. A review of the LCG working groups conducted in early 2014 concluded that ‘significant progress has been made in transforming the LCG into a regular, structured, formal dialogue mechanism’. 

• The project has supported ERD in carrying out a Capacity Need Assessment, the report of which has already been submitted. As per the recommendations of the Capacity Assessment Report, ERD is working to establish a Development Effectiveness Wing which will oversee the ERD works related to Development Effectiveness, South-South Cooperation and external economic policy issues. 

• The project has supported the Bangladesh Government in institutionalizing and sensitizing the aid effectiveness agenda at the local level while positioning itself as an active player in the global development effectiveness arena. Currently, Bangladesh is a member of the Global Partnership Steering Committee, Vice Chair of International Aid Transparency Initiative (IATI) and the Chair of the Asia Pacific Development Effectiveness Facility (AP-DEF). 

Who finances it?

$ 240,847
$ 230,000
Department For International Development of the United Kingdom $ 329,279
$ 69,808
Government of Bangladesh $ 7,875
$ 486,855
$ 312,364
$ 280,869
Government of Bangladesh $ 17,795

Delivery in previous fiscal years

Year Amount
2014 $ 366,772
2013  $ 686,655
2012 $ 778,434

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